Second Investment, First BRRRR

[Chris Allen]

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $45,500
Cash invested: $20,000
Sale price: $143,000

Contributors:
Jeremy Fay

3:1 SFH in Harker Heights TX. Purchased 12/2019 for $45.5k from a wholesaler. After about $10k in rehab, rented property for $825/mo and was able to refi just enough to pay off my $50k private money loan. Sold two years later for $143k for a $77k Net Profit.

What made you interested in investing in this type of deal?

Found BP and after buying my first HH Duplex, I had the itch to do a "real" investment using the BRRRR method and private money.

How did you find this deal and how did you negotiate it?

Found through a wholesaler and after the wholesaler dropped the price twice, was able to offer him a fast close at $45.5k.

How did you finance this deal?

Private Money.

How did you add value to the deal?

Basic touch ups (flooring, paint, light fixtures, roof, and landscaping).

What was the outcome?

Cash flow of about $400/mo for two years and sold for a Net Profit of $77k.

Lessons learned? Challenges?

-Learn to run better comps (refi appraisal came in $30k under what I thought)
- Manage tenants better with at least yearly property inspections (tenants left the house in bad shape when they left)
- Even when you are not able to pull your money back out in a BRRRR, real estate still makes sense.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

Jeremy Fay at EXIT Realty in Copperas Cove TX.